BOARD00873

• Board Meeting Date: 1/26/2000
• Description: CF Section - Changes in Existing Loans - City of Loveland - Green Ridge Glade Reservoir Collateral
• Board Meetings - Doc Type: Memo

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STATE OF COLORADO

Colorado Water Conservation Board

Department of Natural Resources
1313 Sherman Street, Room 721
Denver, Colorado 80203
Phone, [phone]
FAX, (303) 8664474

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Bill Owens
Governor

MEMORANDUM

Greg E. Walcher
Executive Director

TO:

Peter H. Evans
CWCB Director

Colorado Water Conservation Board Members

FROM:

Jan IlIian Contract Administrator .(:;;:v.. Dan McAuliffe
, . Depuj recto<
Mike Serlet, PE., Chief, Water Su~B'Y Planning and Finance sectiofll)

January 14, 2000

DATE:

SUBJECT:

Agenda Item 11(b) January 26-27,2000, Board Meeting
Water Supply Planning and Finance - Change in Existing Loan
City of Loveland - Green Ridge Glade Reservoir Collateral

INTRODUCTION.

At its November 1998 meeting, the Board approved a loan to the City of Loveland, for
which the collateral included a pledge of revenues and a portion of the project equal in
value to the amount of the loan. The City of Loveland has requested that we revise its
collateral requirement to reflect the collateral policy adopted by the Board at its
September 1999 meeting.

BACKGROUND.

At its January 1997 meeting, the Board approved a loan to the City of Loveland in the
amount $2,000,000 for the expansion of Green Ridge Glade Reservoir. At its November
1998 meeting, the Board approved increasing the loan to the City of Loveland by
$3,000,000, for a total loan of $5,000,000. The City will contract for the funds through its
water activity enterprise.

The collateral for the $5,000,000 loan approved by the Board at the November 1998
meeting was "a pledge of water fund revenues at parity with all other lenders and a
portion of the project equivalent in value to the amount of the loan."

At its September 1999 meeting, the Board adopted a policy regarding the collateral for
loans made out of the Construction Fund and the Severance Tax Trust Fund Perpetual
Base Account. The policy provides that the collateral for a loan to a public (government)
entity (which includes municipalities and enterprises) will be a pledge of revenues backed
by a rate covenant and annual financial reporting.